Quit Claim Deed v. Warranty Deed v. Lady Bird Deed- Pros and cons
Understanding Michigan Deeds: Quitclaim, Warranty, and Lady Bird 🌟
When it comes to real estate in Michigan, the type of deed you hold—or plan to use in a transaction—matters more than most people realize. With title companies and lenders scrutinizing deeds more closely than ever, especially for home equity loans, refinances, new purchases, or wholesale investor deals, knowing the difference between a Quitclaim Deed, a Warranty (Covenant) Deed, and a Lady Bird Deed (Enhanced Life Estate Deed) can save you time, money, and headaches.
Why This Matters 🔎
The deed on record affects whether a lender will approve financing, what exceptions appear on your title policy, and whether corrective work is needed before closing. Michigan law recognizes three main types of deeds:
Quitclaim Deed
Warranty Deed
Lady Bird Deed
Each has unique pros and cons, especially in today’s lending environment.
Quitclaim Deed ✍️
A Quitclaim Deed transfers whatever interest the grantor may have—without any guarantees. If the grantor has nothing, the grantee gets nothing.
âś… Pros:
Quick and simple for family transfers, divorce, or correcting title errors.
Low cost and easy to draft.
❌ Cons:
No title promises.
Many lenders won’t accept quitclaims for recent arms-length transfers.
Title companies often add exceptions or require curative work.
Best use: Transfers between family members, divorces, or to clear up ownership issues.
Warranty Deed đź“ś
A Warranty Deed, often called a Covenant Deed in Michigan, guarantees the grantor has good, marketable title and will defend it against all claims.
âś… Pros:
Gold standard for lenders.
Fewer title exceptions.
Boosts marketability for resale .
❌ Cons:
Seller can be liable for title defects.
Requires full title searches and lien clearance.
Best use: Standard sales, refinancing, and home purchases.
Lady Bird Deed 🖋️
A Lady Bird Deed lets the owner keep control during life (sell, mortgage, or change beneficiaries) while passing the property automatically at death—avoiding probate.
âś… Pros:
Avoids probate .
Maintains full control .
Delays property tax “uncapping”.
Helpful estate planning tool .
❌ Cons:
Needs precise drafting .
Lenders may require extra affidavits or subordination .
Complex tax/Medicaid implications .
Best use: Estate planning when you want to avoid probate but keep full ownership control.
How Deeds Affect Financing đź’µ
HELOCs & Refinances → Warranty Deed is best . Quitclaims and Lady Bird Deeds may cause delays or require additional documents.
Purchases → Warranty Deed expected. Quitclaim may raise red flags 🚩.
Wholesale/Investor Sales → Quitclaims often scrutinized heavily. Warranty deeds are safer for marketability.
Practical Takeaways 🧾
Match the deed to your goal: Warranty for financing and sales, Lady Bird for probate avoidance, Quitclaim for family or corrective transfers.
Avoid DIY mistakes—especially with Lady Bird Deeds. Language matters.
Think ahead if financing: A last-minute deed change could stall your HELOC or refinance.
Stay organized: Keep copies of prior deeds, surveys, and title policies.
Final Word ⚠️
Deeds may look simple, but the wrong choice can derail your closing or estate plan. Always consult a Michigan real estate attorney before recording a deed or applying for financing.
Need help? Upton Law, PLLC can review your deed, title history, and goals to recommend the right strategy. đź“ž
👩‍⚖️ Let’s Talk About Your Options
At Upton Law, PLLC, we help families across Michigan create customized estate plans that work. Whether you need a will, a trust, or both, we’ll guide you through every step with clarity and compassion.
đź“ž Schedule your estate planning consultation today.
Meet the founderShakeena Melbourne
At the heart of Upton Law is Shakeena Melbourne, founder and Principal Attorney, a lawyer who is a fierce advocate for your peace of mind and happiness.
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